Chrysler Group logs $690 million losses in first quarter of 2014

Article by Christian A., on May 14, 2014

Chrysler Group posted $690 million in net losses in the first quarter of 2014, no thanks to costs associated with its merger with Fiat. Without those two one-time charges, Chrysler would have posted $486 million in net profit in the period, compared to $166 million in net income in. The company posted 23-percent jump in first-quarter revenue to $19 billion.

The carmaker is reiterating its guidance for the full year 2014 of $2.4 billion in profits sans one-time charges on $80 billion in revenues, chief financial officer Richard Palmer said in a conference call with analysts.

According to Chrysler, it took a $504-million charge for eliminating debts tied to a prepayment of its note with the UAW Retiree Health Care Trust. Chrysler also took $672 million charge for commitments it made in a deal that allowed Fiat to take full control of the US carmaker.

At the end of the first quarter of 2014, Chrysler had a US market share of 12.7 after selling 476,000 units in the country, representing an 11-percent in deliveries. The carmaker’s 30-percent surges in sales of pickups and SUVs more than offset a 30-percent drop in car sales.

On the global scale, Chrysler sold 668,000 vehicles in the first quarter of 2014, including vehicles it builds for other carmakers like Fiat. The US carmaker had cash of $12.4 billion at the end of the quarter and had a gross industrial debt of $12.9 billion.

Palmer disclosed that Chrysler spent around $100 million in the first quarter on recalls. He added that the carmaker didn’t have a capacity constraint on its recently launched Ram 1500 EcoDiesel pickup.

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